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(a) [50,000 × (1 – 1.06^-25) / 0.06] / 1.06^40
(b) [50,000 x (1 – 1.06^-25) / 0.06] divided by
[(1.06^40 – 1)/0.06]For EOQ, Price is constant so ignore the discount and use a price of £36.
So, holding cost per unit per annum
= 0.2 × 36
= £ 7.2 pee unit per annumY receives $ and so will sell $ to get £. So bank sells £ (base currency).
Use Ask ask rate as the bank sells the base currency.
(1.5386 – 0.0051) × 150,000 in Pound.It is easy:
= (IRR – r) / r × 100%
It means that the discount rate can increase by up to that % before NPV becomes negative.
Also, the sensitivity is on discount rate, not discount factor.Amount received (1,203,000) + Opening prepaid income (71,750) – Opening accrued income (53,000) + Closing accrued income (46,000) – Closing prepaid income (78,000)
= $1,189,750You can use a T account to understand better
Debenture represents SPECIFIC BORROWINGS as opposed to GENERAL BORROWINGS for the first two loans.
Also, specific borrowings are not used in determining capitalisation rates.
Lastly, the setter of the question made it easy for you by clarifying that the existing loans from the beginning of the year were used to fund construction of hydro electric plant. Debenture was not present at the start of the year as it has a nil (-) at start.
Transaction costs are capitalised for both FVTOCI and Amortised Cost models.
In our case, it is an Amortised Cost model being used.Also, interest income is taken to SOPL as per amortisation requirements, just that the effective rate is used to get the figure while the coupon rate payment goes to statement of cash flows.
DTLs are not discounted and they are treated as non current components.
Also, nowhere is stated that they are settled in the coming year.
Costs to date not in excess for a particular year would be cost of sales, particularly when you started the contract in that year.
In reality,
Cost of sales
= Costs to date at year end LESS
Costs to date at start of the yearAt OpenTuition, you have to specify where you face a problem as the primary aim is to provide you with knowledge. Not just answers.
31.05.20X6
64,427 + 64,427×0.08 – 25,000 = 44,58131.05.20X7
44,581 + 44,581×0.08 – 25,000 = 23,148PUP is included is Subsidiary is the seller as profit would have to be reduced from NCI too.
The question must then have stated that it is the parent that sold items to the subsidiary. Or Maybe the sale was between group (parent or subsidiary) and associate.Thanks!
Hey.
In the SOFP, never time apportion items or never use percentage holdings.
Just add them as they are.Looks like my posts are being deleted.
I am just trying to support and give back what I got for free.Hello.
By year end, you would have recognised revenue and cost of sales, the difference of which is part of the entire loss.So, recognise the residual loss too in the SOPL and take it as a onerous contract provision.
Hope you got it!
Not true.
Let me help you.
A sale recognises cash of $70,000 and derecogises carrying amount of $60,000 (100,000 – 2 yrs depreciation: 1000,000 / 5 x 2)
Then, a lease recognises lease liability as PV of future lease payments:
20,000/1.1 + (20,000+15,000)/1.1² = 47,107For ROUA, take a proportion of rights retained as
Carrying amount of asset x
[Lease liability / Sale at FV]
= 60,000 × [47,107 / 70,000]
= 40,378DR Cash. 70,000
DR Right-of-use asset (ROUA) 40,378
CR Carrying amount of asset. 60,000
CR Lease liability 47,107
CR Gain (SOPL)(Bal. figure) 3,271Binding constraints are ones the resources of which are fully utilised for a particular optimal solution, meaning that LHS = RHS when optimal values of X and Y are plugged into the constraint.
When you add resources on them, after some production, there may arise new binding constraints and so even them are not fixed.
Shadow price is an increase in value obtained by having an additional unit of a fully utilised resource (binding constraint at the time) at its original cost.
